SKM alleges Rs 115 cr corruption in CMRHM tender bid process

Gangtok, 31 Aug:

Sikkim Krantikari Morcha has accused the Rural Management & Development Department of indulging in corrupt practices in the tender bid process of the Chief Minister's Rural Housing Mission [CMRHM] scheme. The party has contested that not only the RMDD but the entire Cabinet is involved in corruption amounting to Rs 115 crore.

Addressing a press conference here today, SKM spokesperson, Jacob Khaling informed that the Cabinet meeting on 07 May 2016 passed the proposal to build 3,000 houses at the cost of Rs 8,80,118 each under CMRHM scheme at the total cost of Rs 264.354 crore.

He alleged that instead of providing contract of individual houses to different contractors, all houses were clubbed together and so many criteria were added that even A1 contractors of the State could not qualify to bid for the project.

He further added that only three companies finally qualified for the project but when the tender was opened on 30 Jan 2017 only one company - Mungipa Trade [private] Limited and Sunil Kumar Agarwal [joint venture] participated in the bid.

Mr Khaling mentioned that as per the State Public Works Department code & manual and even RMDD, if there are less than three bidders the tender should be rejected and a fresh tender should be called.

On the same, he added that despite such rules the RMDD started the process to offer work to Mungipa Trade [private] Limited and Sunil Kumar Agarwal [joint venture] breaking all rules and clauses. He added that the cabinet on 21 Feb 2017 passed the single bid.

“Taking advantage of being the only company to make a bid they quoted 49.75% above the estimated cost and finally the department settled it at 43.6% above the estimated cost and awarded the work to the company,” Mr Khaling said. He added that the work order was issued on 02 Mar 2017.

On getting the work on 43.6% above the estimated cost, the cost of each house was up from around Rs 8 lakh to Rs 12.64 lakh and extra Rs 115 crore added to the actual amount of the project, he added.

“Rs 115 crore is a huge amount for a small state like Sikkim and not only RMDD but the entire system and the cabinet have been involved in this corruption,” he alleged.

Mr Khaling claimed that the money for the project is not being sourced from any grant but from the loan taken by the state government from HUDCO at 10% interest. He added that the government has taken a loan of Rs 361 crore from HUDCO with the state share of Rs 57.33 crore.

He informed that this loan needs to be repaid to HUDCO by 2035-36 with interest of Rs 334.62 crore making the total amount Rs 695 crore after adding the principal amount.

After issuing of the work order the department again started the process to provide 15% mobilization fund to the contractor, he further alleged. On the same, he added that as per the government rule the department cannot release any mobilization fund but despite this, mobilization advance of Rs 56.88 crore was released on 23 May 2017.

“Even after the mobilization advance was released, no work has taken place at the ground level so far,” he alleged.

On behalf of SKM, Mr Khaling demanded that the RMDD immediately cancel the work order and call a fresh tender for the work. He also demanded that mobilization advance should be refunded to the government.

He also suggested that contract should be given to small contractors and cooperative societies of the respective villages for each CMRHM house. Mr Khaling threatened to approach the High Court if the department does not take any action in this regard.